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Stand With the Chinese People: Trade With Them Freely

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Here’s yet another letter to Nolan McKinney:

Mr. McKinney:

You allege that my and others’ “support of free trade is support for despots like [Chinese president] Xi and tyranny overseas.”

Not so. My and others’ support for free trade is opposition to despots and tyranny here at home.

You’ll push back by arguing that by allowing Americans to trade freely with the Chinese, the U.S. government supports Beijing’s tyranny. But that argument is weak. As explained by Nobel-laureate economist Ronald Coase and Ning Wang [2], by Nicholas Lardy [3], and by many others, the Chinese people grew richer to the extent that they embraced free markets. Because free markets give ordinary people more options (not to mention tastes of freedom), a predictable, if ironic, consequence of the enrichment of ordinary Chinese people is increased suppression by Beijing’s authoritarians, who are desperate to hold on to power.

Unlike many, I believe that the experiment in China is still playing out. For Beijing to (re)establish and to retain anything remotely close to the level of tyranny that reigned under Mao – and that I don’t doubt Xi & Co. would relish – Beijing will have to cram the market genie back into its bottle. Because such cramming is made multiple times more difficult the more numerous and thick are the commercial ties that the Chinese people have with other peoples, including Americans, U.S.-imposed restrictions on trade will likely raise, not lower, the likelihood that Xi fully succeeds in strapping the Chinese people again securely to tyranny’s rack.

Is the opposite outcome possible? Of course it is. But I point you now to Hong Kong. These are people who have enjoyed freedom and free trade for much longer, and much more fully and deeply, than have their brothers and sisters on the mainland. The people of Hong Kong are not going quietly into the gruesome night of tyranny. Yes, Beijing might eventually ‘win’ in Hong Kong. But to do so it must unleash such blasts of brutality that perhaps – perhaps – even the likes of Xi understands will bring a ‘victory’ only Pyrrhic.

But one thing above all seems highly likely (for nothing in such matters is certain): to the extent that we reduce our commercial ties with the Chinese people, we make them poorer and less able, and perhaps also less willing, to resist Xi and his goons. Yes, we also make Beijing poorer. But the greater effect will be on ordinary Chinese people. With the Chinese people poorer, and with their trade ties to the west severed, the Chinese communist party will have an easier time of bringing full-on tyranny back to China. It will also have even greater incentives to do so given that there will be little wealth for it to gain by allowing its subjects even a modicum of economic freedom.

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030

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